23
LNB Bancorp, Inc.
Exhibit to Form 10-Q
(For the six months ended June 30, 1996)
S - K Reference Number (10b)
Supplemental Retirement Agreement by and between
Thomas P. Ryan and The Lorain National Bank dated
July 30, 1996.
Note: The Employment Agreement referred to in Section 1.
of this contract was filed as Exhibit (10c) to the
1995 third quarter report on Form 10-Q of LNB Bancorp,
Inc.
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DPB/cf
7/26/96
SUPPLEMENTAL RETIREMENT AGREEMENT
FOR THOMAS P. RYAN
THIS AGREEMENT, made and entered into this 30th day of July, 1996, by
and between LORAIN NATIONAL BANK (hereinafter referred to as the "Bank"), a
national banking association organized and existing under the laws of the United
States, whose principal place of business is Lorain, Ohio, and THOMAS P. RYAN
(hereinafter referred to as the "Executive").
WHEREAS, the Executive has rendered valuable services to the Bank for
many years and it is the desire of the Bank to provide him with certain
Supplemental Retirement Benefits in addition to the retirement benefits provided
to him under the Lorain National Bank Retirement Pension Plan; and
WHEREAS, the Executive has performed his duties in a capable and
efficient manner, resulting in substantial growth and progress to the Bank; and
WHEREAS, the Bank desires to retain the services of the Executive,
and realizes that if the Executive were to leave the Bank it could suffer a
substantial financial loss; and
WHEREAS, the Executive is willing to continue in the employ of the
Bank if the Bank will agree to pay certain benefits in accordance with the
provisions and conditions hereinafter set forth; and
WHEREAS, it is understood and agreed that this Agreement is to be
effective as of June 4, 1996; and
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, the parties agree as follows:
1. Employment of the Executive
---------------------------
The Executive shall continue to perform duties for the Bank in such
senior executive capacity as its Board of Directors may designate from time to
time. The Executive's employment shall continue until terminated pursuant
to Employment Agreement entered into between Bank and Executive, dated September
11, 1995. The Executive shall devote his best efforts to the performance of his
duties for the Bank.
2. Compensation
------------
The Executive shall be compensated for the performance of his duties
as provided for in the above referred to Employment Agreement.
3. Supplemental Retirement Benefit
-------------------------------
If the Executive's employment with the Bank should cease for any
reason other than discharge for cause (as hereinafter defined) or a retirement
prior to April 1, 2000, the Executive or his beneficiary, as the case may be,
shall be entitled to receive the Supplemental Retirement Benefit or a form
thereof.
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(a) Normal Retirement
-----------------
If the Executive remains in the continuous employ of the Bank and
retires from active employment with the Bank on or after April 1, 2003,
the Executive and/or his beneficiary will be entitled to receive a
Supplemental Retirement Benefit which when added to the Executive's
pension benefits and social security benefits would equal seventy
percent (70%) of the Executive's Lorain National Bank compensation for
the full calendar year of employment preceding Executive's
retirement as reflected on the Executive's W-2 Federal Income Tax
Statement for such year and payable each year for a ten (10) year period
commencing one (1) month after Executive's retirement date. The
Supplemental Retirement Benefit shall be paid annually or ratably in
twelve (12) equal monthly installments each year during the ten (10)
year period as the Executive or his beneficiary may elect.
(b) Early Retirement
----------------
In the event the Executive retires prior to April 1, 2003, the Executive
and/or his beneficiary shall be entitled to receive an applicable
percentage of the aforementioned Supplemental Retirement Benefit. The
applicable percentage for the corresponding early retirement ages are as
follows:
Early
Retirement Applicable
Ages Percentage
---------- ----------
57-61 0%
62 25% of the full benefit (70%)
63 50% of the full benefit (70%)
64 75% of the full benefit (70%)
The corresponding benefits will be paid on a per year basis payable over
a ten (10) year period.
(c) Disability Benefit
------------------
If the Executive should become disabled while employed by the Bank and
prior to reaching age sixty-five (65), the Executive will be eligible to
receive his Supplemental Retirement Benefit commencing at age 65, as if
he had retired on or after April 1, 2003.
(d) Death Benefit
-------------
In the event the Executive should die after having established
eligibility for benefits (based on meeting either the early or normal
retirement age requirements) set forth under this Agreement, any amounts
due or remaining to be paid shall be paid to such beneficiary or
beneficiaries as the Executive may have designated by filing with the
Bank a notice in writing in a form acceptable to the Bank. In the
absence of any such designation, such unpaid amounts shall be paid to
the Executive's surviving spouse, or, if the Executive should die
without a spouse surviving, to the Executive's estate.
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(e) Discharge Without Cause
-----------------------
If the Executive is discharged without cause, the Executive shall be
entitled to receive the Supplemental Retirement Benefit equal to the
corresponding amount as if he had retired on or after April 1, 2003.
Supplemental retirement benefit payments shall commence to be paid to
Executive at such time as Executive elects to begin receiving pension
benefits and shall be based upon Executive's compensation for the last
full calendar year of employment preceding Executive's discharge as
reflected on Executive's W-2 Federal Income Tax Statement for such
year.
Executive shall be under no obligation to elect to receive Social
Security benefits at any specific time during the Agreement term.
For purposes of this Agreement, Executive's pension benefit offset
shall be calculated as though payable as a single life annuity for Executive's
life expectancy.
For purposes of this Agreement, the term "discharge for cause" shall
mean a termination of the Executive's employment by reason of his commission of
any material act of dishonesty during his employment, or breach of the terms of
his Employment Agreement, which, in the good faith opinion of the Board of
Directors of the Bank, adversely affects the interests of the Bank or his
conviction by a court of last resort of a felony involving moral turpitude
committed during his employment.
For the purposes of this Agreement, the term "permanent disability"
shall mean physical or mental impairment which prevents the Executive from
engaging in further employment by the Bank as a senior executive on a full time
basis and which, on the basis of medical evidence satisfactory to the Board of
Directors, is expected to continue for a period of six (6) months.
It is intended that the events which shall give rise to an entitlement
on the part of the Executive or his beneficiary to receive the Supplemental
Retirement Benefit or a form thereof shall include:
(i) The normal retirement of the Executive on or after April 1, 2003.
(ii) The early retirement of the Executive on or after April 1, 2000.
(iii) The permanent disability of the Executive.
(iv) The death of the Executive after reaching early retirement age.
(v) Discharge of the Executive without cause.
4. Non-alienation of Benefits
--------------------------
The right of the Executive, or any other person, to the payment of
benefits under this Agreement shall not be assigned, transferred, pledged or
encumbered, any attempt to do so shall be void.
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5. Executive's Rights Under This Agreement to be Those of an Unsecured
-------------------------------------------------------------------
Creditor of the Bank
- --------------------
The rights of the Executive under this Agreement, and of any
beneficiary of the Executive, shall be solely those of an unsecured creditor of
the Bank. Nothing contained in this Agreement and no action taken pursuant to
the provisions of this Agreement shall create or be construed to create a trust
of any kind or a fiduciary relationship between the Bank and the Executive or
his beneficiaries. Any funds, insurance contracts or other assets of the Bank,
whether designated by the Bank to provide the benefits contemplated herein or
not, shall at all times continue to be a part of the general funds of the Bank
and no person other than the Bank shall, by virtue of this Agreement, have any
interest in such funds or assets.
6. General Provisions
------------------
This Agreement shall not be deemed to constitute a contract of
employment between the parties, nor shall any provisions hereof restrict the
right of the Bank to terminate the Executive's services or restrict the right of
the Executive to terminate his services.
The Board of Directors shall have the full power and authority to
interpret, construe and administer this Agreement, and all actions taken by the
Board of Directors in good faith shall be binding and conclusive on all persons
concerned. No member of the Board of Directors shall be liable to any person or
any action taken or omitted in connection with the interpretation or
administration of this Agreement unless attributable to his own willful
misconduct or lack of good faith.
This Agreement shall be binding upon and inure to the benefit of the
Bank, its successors and assigns, and the Executive, his heirs, executors,
administrators and legal representatives.
This Agreement shall be construed in accordance with and governed by
the laws of the State of Ohio.
IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed
by its duly authorized officer, and the Executive has hereunto set his hand as
of the date first above written.
IN THE PRESENCE OF:
BANK
LORAIN NATIONAL BANK:
/s/ Paulette Mager BY: /s/ J. F. Kidd
- ------------------------------ --------------------
/s/ Denise DeVito President
- ------------------------------
EXECUTIVE
/s/ Paulette Mager /s/ Thomas P. Ryan
- ------------------------------ -----------------------
/s/ Denise DeVito Thomas P. Ryan
- ------------------------------